The E-commerce Opportunity in Vietnam for Q1 of 2024

Over the past couple of years, the E-commerce market in Vietnam has expanded rapidly, from just 2.8% of total retail sales in 2015 to about 8.8% in 2023. These sales figures were contributed by the 57 million Vietnamese consumers who made online purchases in 2023, with the majority located in the population hubs of Ho Chi Minh City, Hanoi, and Da Nang City.

The E-commerce market is estimated to reach USD14.7 billion in 2024 and USD23.77 billion by 2029 (CAGR of 10.09%).

Updates for Q1 of 2024

Over the first quarter of 2024, E-commerce platforms saw a transaction value of over USD2.8 billion (YOY growth of 78.7%) and a transaction volume of over 766.7 million products (YOY growth rate of 83.2%). These numbers were far above the forecasted growth of 35%.

Among the top online categories in Vietnam in Q1 of 2024 are beauty products, which reached a sales value of USD440 million (YOY growth of 63%), women’s fashion, achieving a sales figure of USD375 million (YOY growth of 94%), and homeware and home appliances, which saw USD358 million of sales (YOY growth of 79%).

The forecasted total sales for Q2 of 2024 is USD3.33 billion, which is in itself a 19% growth from Q1 and an impressive 78% YOY growth when compared to Q2 of 2023.

When it comes to the top E-commerce platforms of 2024 in Vietnam, Shopee is far ahead of the competition, with an estimated market share of 67.9%. In second place is TikTok Shop, with a market share of 23.2%, followed by Lazada at 7.6% and Tiki at 1.3%.

TikTok released key stats from their platform in Vietnam, including over 2.8 million SMEs selling on the platform and a tripling of merchants in the country that are seeing steady sales compared to the previous year. The platform is also seeing a 12-fold increase in views on livestreams and short videos and a 32-fold increase in purchases through the TikTok Shop search function in Vietnam. These figures indicate the shift towards combining shopping and entertainment (“shoppertainment”), with more users than ever actively searching for products to purchase on social media.

However, in Vietnam, TikTok remains overshadowed by Shopee, which is beginning its own ventures into shoppertainment with the launch of Shopee Video. This new feature will allow users and merchants to interact in a similar manner to TikTok Shop, tapping into the increasing interest among consumers for video content, especially with exclusive promotions offered through the new features.

All of these statistics indicate a shift in shopping habits among Vietnamese consumers, with more people beginning to trust online platforms and shifting away from cash payments. At the same time, more brands are jumping onto the opportunity, onboarding, and offering their products through E-commerce platforms in Vietnam.

As can be seen, Vietnam is seeing huge strides in its digitization journey, with its digital economy growing at the fastest rate among its neighboring countries in Southeast Asia, even as other countries are also seeing increased sales across E-commerce.

Are you interested in how your brand might be able to take advantage of this growing market? Reach out to RedFern Digital today!